Stocks make impressive climb so far in 2012

BERNARD CONDON

Saturday

Mar 31, 2012 at 3:33 PM

NEW YORK - The bulls weren't bullish enough.

The stock market just had its best first quarter in 14 years. The surge has sent Wall Street analysts, some of whose forecasts seemed too sunny three months ago, scrambling to raise their estimates for the year.

Doll says stocks could rise 10 percent more before the end of the year. That would be enough to push the Dow Jones industrial average to an all-time high and the Standard & Poor's 500 close to a record.

For the first three months of the year, the Dow was up 8 percent and the S&P 12 percent, in each case the best start since the great bull market of the 1990s. The Nasdaq composite index, made up of technology stocks, has had an even more remarkable run - up 19 percent for the year, its best start since 1991.

"I don't think anyone could have predicted this," says Chip Cobb, a senior vice president at Bryn Mawr Trust Asset Management. For these gains, he says, "I thought it would take all year."

The jump gives money managers like Cobb hope that ordinary folks burned by two deep bear markets in a decade will start buying again, propelling the indexes even higher.

In a remarkable act of self-restraint - or foolishness, depending on your view - they have mostly stayed out of the market. One reason they may jump in now is that fear of looming disasters, like a full-blown debt crisis in Europe or a second recession in the United States, has faded.

Bulls say investors will turn their attention to the only thing that really matters for stock prices in the long run - corporate profits.

Another hopeful sign for gains is that those who have been buying stocks appear to be taking bigger risks than before, suggesting growing confidence.

Even a few duds got caught in the upswing. The stocks of Microsoft and Cisco have barely budged this century. This year, they have risen 24 percent and 17 percent, respectively. Dell, which has languished for years, is up 13 percent.

Some of the big winners of 2012 are perhaps less surprising: Apple has risen 48 percent. Lions Gate Entertainment, the company behind the hit movies "The Hunger Games" and "Twilight," is up 67 percent.

As if the surge weren't enough, the markets impressed long-time stock investors with the way it climbed - slowly and steadily, without the wild swings of bravado and panic that characterized the market much of last year.

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